QRSciences plans scale of Perth business

QRSciences Holdings is planning to sell its Perth technology business as it moves to cut costs and push into the black.

The group said yesterday it was reviewing the Perth operations with a view to divesting or "reconfiguring" the business "to ensure its future viability".

"I don't want to see the business lose any more money," QRSciences chief executive Rick Stokes said.

Mr Stokes said the company, which recorded a $3.74 million loss for the December half year, had poured "a lot" of money into its WA research and development unit but funding for new technologies had dried up as a result of the global financial crisis and it was proving a burden for the Melbourne-based parent.

"We have spent a lot of money over the years developing technology for large markets that didn't eventuate," he said. "I think in this environment we are being prudent in making sure everything we do gets a commercial outcome."

The Perth business, QRSciences Pty Ltd, is focused on the development of airport security technologies, including weapons and explosive detection devices. But most of the parent's business is derived from the distribution of closed circuit television systems.

The group embarked on a cost-cutting drive last month with the aim of saving $600,000 a year. The cuts have included middle management redundancies.

It raised more than $1 million in fresh equity earlier this year from an underwritten rights issue, a move Mr Stokes said indicated investor faith in the company.

"We were one of the successful companies to raise capital. For a small mid-cap that is quite an achievement in this environment, so someone has got to have faith to do that," he said.